Hair Raising New Study: Charter Schools May Be Economic 'Bubble' That Bursts in Urban Communities
Are charter schools the new sup-prime mortgages?
Are charter schools the new subprime mortgages? That's what UConn scholar Preston Green argues in a provocative new paper. Green and his co-authors argue that the rapid expansion of charter schools, with government encouragement but little oversight, is leading to what they warn is a charter school "bubble" in urban communities. Of particular concern: the growing practice of allowing so-called "multiple authorizers" to approve charter schools, but without any responsibility for educating students when the schools struggle or fail.
The following interview with Green has been edited for clarity and length.
EduShyster: It’s unusual to see the words "hair-raising" and "academic study" in tandem, but your new study merits that marriage. You and your co-authors make the case that, just as with subprime mortgages, the federal government is encouraging the expansion of charter schools with little oversight, and the result could be a charter school "bubble" that blows up in urban communities. Do I have it right?
Preston Green: The problem of subprime mortgages began in part because the government tried to increase homeownership for poor people and minorities by enabling private entities to offer more mortgages without assuming the risk. Under the old system, the mortgage originator was still at risk if the mortgage went into default. With subprime, they were able to spread that risk by selling the mortgages on the secondary market. You had all these mortgage originators that could issue more mortgages without careful screening because they no longer had skin in the game. Now how are charter schools similar to subprime? In the charter school context, charter school authorizers are like mortgage originators.
EduShyster: There’s a great moment in the new movie The Big Short when Selena Gomez turns to the camera and explains to the world what collateralized debt obligations are. Here’s your opportunity to do the same, but for the convoluted world of charter school authorizing.
Green: Promoters of charter school expansion are calling for an increase in Hair Raising New Study: Charter Schools May Be Economic 'Bubble' That Bursts in Urban Communities | Alternet: